State Farm, California's leading insurer, is set to increase premiums by 17% to rebuild capital after devastating Los Angeles fires. This move aims to prevent a financial crisis and maintain insurance availability in high-risk areas.

Following a judge's ruling Monday, State Farm customers in California are one step away from paying more on their homeowners insurance to alleviate what the company described as a "dire" financial situation in the wake of the Los Angeles-area wildfires.

State Farm has argued the emergency rate hikes are necessary to help the company avoid a “dire” financial crisis that could force them to drop more California policies.